The December 14 natural gas contract fell lower for a fourth day on Thursday closing back under the 4.000 level for the first time in nearly 2 weeks.
Losses on Thursday for the December contract were the highest of the week coming at in .208 or 5% settling at 3.977.
Important support areas have been reached overnight which could mark a trend turn back higher.
The first support is the 40 day moving average at 3.990 followed by 62% Fibonacci retracement at 3.970. A third support area was the closing of a gap area created on last Monday’s open between 3.955-4.046 with the current low being 3.956.
If 3.955 support is broken, 3.880-3.900 will become the next downside support area.
The December contract has rallied up to a 4.024 high overnight which is the first area of resistance today followed by previous daily low support at 4.110-4.120. Longer term resistance is the 10 day moving average at 4.185.
Recent volatility over the past 3 weeks looks to be a sign of what to expect for this upcoming winter – wide price swings and rapid price movement.
Technical Indicators: Moving Average Alignment – Neutral
Long Term Trend Following Index – Bullish
Short Term Trend Following Index - Bullish
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